Do you own a small business? Are you considering selling your business, perhaps for retirement or to pursue another opportunity? If you've never sold a business before, you may find that it can be a challenging process. Buyers aren't always readily available, and the potential buyers you do find may scrutinize your business intensely before making an offer.
If you can't answer their questions, or if your answers aren't satisfactory for them, you could have a hard time moving the deal across the finish line. Fortunately, there are steps you can take to make your business more appealing. Here are three tips to help you sell your business.
Keep your key employees in the loop. Remember, your buyer isn't just buying the business name and any associated property. He or she is buying everything that comes along with your business. That includes your employees, especially the ones that play a key role in the business's operations.
Your business will be much more attractive if buyers are confident that your key employees will stay on board. Keep your key team members informed of your plans. Offer to give them bonuses to stay on-board through the transition and beyond. If you can offer an experienced, competent team, buyers will find your business much more attractive.
Invest in your process. Is your business a well-oiled machine? If not, what's holding back your efficiency and productivity? Do you need an upgrade in software? Do you need to fill an open position on your staff? Is a reorganization needed? If there's a glaring in need in your company's process, now is the time to invest in a solution.
Most buyers will want a business that doesn't need major upgrades. If you have a problem with your process or operational foundation, a buyer is likely to identify it, and that could drive them to walk away or ask for a significant price reduction.
Get an independent assessment. Pricing a business is often more of an art than a science. If you price too low, you risk getting far less in compensation than the business is worth. Price too high and you may not find a buyer. You can make the pricing process easier by hiring an independent business valuation expert to evaluate your company. They'll inspect the financials, your vendor relationships, your customer base, and more to come up with a valuation figure. They may even offer recommendations on how to increase the value.
Of course, working with a broker can resolve a lot of these issues. The broker can advise you on the correct price for your business, advise you on how to make your company more attractive, and help you identify potential buyers. Contact a business broker like one from RLS Associates in your area for more information.